SEBI Plans Longer-Term F&O Contracts to Boost Derivatives Market

SEBI is considering the introduction of longer-term futures and options (F&O) contracts in the equity market as part of its review of the derivatives ecosystem, as per news reports.  

SEBI Chairperson Tuhin Kanta Pandey said the proposal is intended to support the development of the market by expanding the range of available contracts. 

Lending and Short Selling Frameworks Under Review 

The regulator is also reviewing the securities lending and borrowing (SLB) and short-selling frameworks.  

According to Pandey, the exercise is for improving the connection between the cash and derivatives markets and supporting liquidity.  

He said SEBI has already introduced measures related to risk management, surveillance, and market monitoring in the derivatives segment. 

Bond Derivatives and IGP Review 

Apart from equity derivatives, SEBI is examining the possibility of introducing derivatives linked to the bond market in coordination with the Reserve Bank of India (RBI).  

The regulator is also reviewing the Innovators Growth Platform (IGP), which provides a listing route for companies from sectors such as artificial intelligence, semiconductors, clean energy, biotechnology, advanced materials, defence and technology. 

Changes to Disclosure and Delisting Rules 

Pandey said the Listing Obligations and Disclosure Requirements (LODR) framework is being reviewed to reflect changing governance and disclosure requirements. SEBI is also examining the delisting framework.  

According to the regulator, the market should have transparent processes for both listing and delisting of companies. 

Read More: SEBI Proposes New Method for Stock Price Bands Across Multiple Exchanges! 

Conclusion 

The review covers several parts of the capital market, including derivatives, fundraising platforms and disclosure rules. The proposals remain under examination as SEBI looks at changes across different segments of the securities market. 

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